For days now the Autumn Budget has been the business conversation of the day, every day — a steady stream of “will she do this?”, “will she do that?”, mixed with plenty of theories, leaks, and confident predictions from people who have never met a spreadsheet they could not speculate over.
The general guesswork was that Labour would keep the big headline rates of Income Tax, National Insurance and VAT untouched, but might still look for extra revenue in quieter ways.
Now for what was actually announced… here are the actual Budget changes, translated into the practical “so what?” for you.
The main measures
- Income Tax thresholds stay frozen for longer. No rate change, but the freeze runs on, so more income gradually creeps into higher bands over time.
- Dividend tax rises by 2% from 6 April 2026. If you take dividends from your company, the tax on those dividends ticks up next year, while the difference between existing pay structure and PAYE remains more beneficial to most, the tax saving gap is certainly getting narrower. People who maximise their earnings up to £50,270 from salary and dividends should expect to pay around £745 more in tax a year.
- Savings and property income tax also get nudged up (from April 2027), with dedicated property rates for landlords. Nothing changes this tax year, but it is one to plan for if you have rental profits or meaningful interest income. We may see more properties on the market as a result of another tax burden on landlords.
- Salary sacrifice into pensions is being capped for National Insurance relief from April 2029. Plenty of runway here, but anyone using sacrifice heavily should expect a tidy-up review before it bites.
- Business rates help for many retail, hospitality and leisure businesses from April 2026, plus capital allowance tweaks to encourage investment. If you are in those sectors or planning big kit spend, there is genuine good news.
- Minimum wage is rising again from April 2026. The National Living Wage (21+) goes up 4.1% to £12.71 an hour, with larger percentage rises for younger workers and apprentices. Great for staff, and a heads-up for wage budgeting.
- From 2028, electric cars will face a new road-use charge based on mileage: 3p per mile for fully electric vehicles and 1.5p per mile for plug-in hybrids. It is essentially fuel duty getting an electric makeover. It is still a few years away, but if you run company cars or a fleet, it is one to keep in mind for longer-term cost planning.
- Employee Ownership Trusts: relief is tightened. The headline change for succession planning is that the CGT relief on sales into an EOT is now restricted to 50% (down from the previous 100%), alongside tougher qualifying rules. If employee ownership is on your radar, this has not killed the idea, but it does make early planning more important.
And the wider backdrop…
The growth picture is not “wow”, but it is positive: 2025 is now forecast to grow around 1.5%, 2026 around 1.4%, then a steady 1.5%ish a year after that — so the story here is “slow and steady”, which is a pretty decent environment for sensible planning.
So what should you do next?
- Company owners taking dividends: we will revisit the extraction of profits planning for 2026 onwards.
- Landlords / savers: Consider the changes from April 2027
- Salary sacrifice users above modest levels: we will pencil in a review before April 2029.
- EOT or exit planning: let us talk early, because the numbers have changed.
- Employers generally: build the April 2026 wage increases into budgeting now.
There is no doubt some of these rises are significant. Freezing the Income Tax thresholds is the big one — the kind of change that does not shout, but definitely nudges the bill up over time, with forecasts suggesting roughly one in four people could be higher-rate taxpayers by 2030 if the freeze runs its course.
Please let us know if you need to go through anything on the above.
Warm regards,